Hi, everyone. You're listening to HBS After Hours.
I'm Youngmee, and I'm here tonight with my buddies, Mehere and Felix.
Hi, guys. Hey, Youngmee.
So I have to start by asking whether or not either one of you watched The Royal Wedding.
And I know you have strong opinions about the monarch.
Super strong. Yes, you hate that stuff.
Think about it all the time.
No, I love that stuff.
Do you? Oh, yeah. Oh, I had the sense that both of you guys were very cynical about that stuff.
I'm never cynical about a wedding.
So did you watch it?
I did not. I did look at the wedding photos afterwards, and there's a wonderful—I thought some of the family wedding photos were fantastic.
But I did not watch the whole thing.
How about you? Yeah, no, sorry.
So we can't— But I did hear about it.
That's, you know— That was really unsatisfying.
All right, so this is a hard segue.
I was about to say, good luck with this one.
Oh, my God. I know.
But I did bring in a topic that we've actually talked about before.
We've talked about the NRA and gun control, but I have to bring it back up again tonight, guys.
So I want to talk about that.
And then, Felix, I know that you brought in something to talk about.
Yeah, I want to talk about Amazon and the chances of Boston being the city.
Being the city? The city.
Okay. All right, so I think the very first episode that we taped of this podcast came right after the shooting in Parkland.
And as a result, in that very first episode, we spent part of our time talking about the NRA.
And in particular, at one point, Meher, you threw out an out -of -the -box suggestion for how we might begin to think about gun control in a different way.
And so I thought, what if we spent a little bit of time tonight almost brainstorming out -of -the -box ideas for how to think about gun safety?
How to think about gun control?
Because I find myself so frustrated.
So Meher, if you don't mind getting us started, when, again, last time you had what I thought was just an interesting idea, you called it a socially responsible hostile takeover.
Yeah. So, you know, I think what was striking to me at the time and still remains striking to me is there's a lot of money that flows into philanthropic efforts.
So in this context, the really interesting thing is the major gun manufacturers have been terrible stock performers.
They've been absolutely horrible.
In fact, one is coming into bankruptcy.
Bonds are trading at 20 cents.
That's Remington, right?
That's Remington. And the short calculation I did was that you could buy and control all the U .S.
capacity for like 2 billion plus, which is like obviously a big number, but in some sense vanishingly small in the context of anything that matters.
And so it just strikes me that somebody, a well -known philanthropist or for that matter a crowdfunded vehicle could actually control huge amounts of capacity.
And then what would you do?
Well, the answer is you could do whatever you want to do.
You could conceivably shut down capacity, which I think is less interesting perhaps, but you could just control it.
And you could control resupply, and you could control the evolution of the weapons.
The biggest advantage of doing this is if you control it, it's an incredible amount of power.
The big weakness is the foreign producers, right?
So there are the Europeans.
But don't they represent less than 50 percent?
Yeah, exactly. So those three actually control something like 60 percent of different, depends on whether you're talking about pistols or handguns or what it is, but the calculations I did have each one of those.
And it's incredible that you can control like 50, 60 percent of the market with $2 billion.
And you can make a reasonable case for why they should be taken over, which is they've been terrible stock performers.
And so it even has that feel of an activism campaign.
And as the owner, you could do really interesting things.
You could start thinking about the product portfolio.
Exactly. Maybe we're no longer going to produce assault weapons, or maybe semi -automatic weapons are going to.
Or maybe we'll make a really interesting effort into producing smart weapons.
I think it's a fascinating idea.
I really did. I was reading a story about this nun in Seattle.
So this nun in Seattle, after the Parkland shooting, she was so upset that she went and she started buying stock in Sternberger.
Oh, really? And so she bought $2 ,000 worth of stock, which is the minimum amount that you have to purchase to request a meeting with the board and the CEO and to submit proposals at the next shareholder meeting.
So she requested a meeting.
She couldn't get, they refused to meet with her, but she submitted a proposal.
And the proposal was she wanted to require the company on an annual basis, produce a report that tracked the number of violent incidents related to their products.
And that also created transparency about what they were doing around smart gun technology.
The CEO and the company was really upset at her for doing this.
So they came out strongly against this tiny little shareholder, but she had her own allies and guess what?
She won. She got 69 % majority and all the institutional shareholders backed her, including the largest one, which was BlackRock.
Well, that's the interesting thing.
These folks are trying to be socially responsible, but the question is, what's the mechanism for them to do it?
So she gave them probably what they wanted more than anything else.
But I thought of you here because I thought, okay, I mean, we all believe in the Second Amendment, but there are so many in between steps you can do to just be a more socially responsible company and be more transparent about the way you market your products.
And I thought this was just a tiny example of, you know, and I thought, that's not a crazy idea.
Felix, do you have any crazy ideas?
Actually, I was thinking a little bit about ways to make headway.
And so I was thinking about two things.
First thing to realize, two thirds of deaths caused by guns in the United States are suicides.
And then the other statistic that I found really intriguing is, if you look at mass shootings, which the FBI defines as shootings in which more than four people die, so that's considered a mass shooting, a little more than half of those happen within a domestic context, typically very often in families.
And so I was thinking, looking back, we always have these traces, right?
We see, oh, there was some indication that something horrible might happen, or this person made a particular comment.
And then once you see after it happened, it's easy to sort of see how the pieces fit.
And so I was thinking, what if we had used technology to collect information in a smart way?
Here's what I was thinking about.
If I'm afraid, either that you're going to commit suicide, or if I'm afraid that in some domestic situation, you might be violent, I can submit your name and personal information to a database.
And the information is locked, no one has access to it, up until the moment when several people do the same thing.
So the moment you'd have three members of a family that are afraid that, oh, my God, what is this person?
The same person. Or in a school setting or concerned or in a school setting, you have two teachers who are concerned about a particular student.
And so we could set that threshold at any level we want, maybe it's two people reporting, maybe it's five people reporting, and then you could get either law enforcement or in the case of suicide, people who can assist, others who have.
Sure. It's also interesting because right now there's a very high bar for reporting to law enforcement, right?
And you're basically lowering the bar dramatically, meaning I think anybody can report in your scheme.
One of the issues that it would run into is just there's a little bit of a big brotherly aspect to it, which is citizens reporting on citizens in a way that is...
That's right, yes. And I should say there's a conversation, I think, among lawyers about this.
They often refer to as an information escrow idea.
Interesting. I love that name.
I think it's fabulous, right?
And it actually exists, I think, as a fairly small service in the context of sexual violence.
There's an app called Callisto that essentially works that way.
Women who experience sexual violence are very reluctant to come forward for a thousand reasons that we know.
But when you ask women, would you come forward if it helped prevent another incident?
You're so much more likely to do that because now you can be helpful to someone else.
And so it's that same idea.
You can report and the information remains locked in escrow up until a particular level that to your point me here, we can decide if the big brother aspect really concerns us.
Maybe we make that threshold pretty high.
Well, you know, maybe a dozen people in a school have to take care of someone.
But it also depends on who gets to hold it in escrow, right?
If you have some trusted party that is holding an escrow, that sort of sits in between the community and law enforcement almost.
Well, I think it's also interesting because it's not going to trigger a chargeable offense.
So like, let's say my name comes up 12 times.
What's going to happen?
I assume the police are going to come visit me.
And have a conversation.
And have a conversation, which actually could have some significant deterrent effects.
Yes. Or in the context of a school, it's the psychologist who reaches out and says, are you okay?
Are you worried? Yeah, that's the last idea.
The only thing I have to add to this is there's a part of me that wonders whether or not we should turn all of our attention to laws at the state level.
So a couple of things kind of triggered the thought for me.
And one was, so recently, there was a research study in JAMA, the Journal of American Medical Association.
And so states that have stricter gun control laws are significantly safer in terms of gun deaths.
But not only that, if you are a state with weak gun laws, and you are surrounded by states with strong gun laws, the number of deaths in your state, it spills over.
Okay? That's interesting.
And then the third piece of data that I found NRA effectiveness at the state level is highly variable.
And there is quite a bit of evidence that in recent years, at the state level, it's declining.
So not only is it highly variable, even in the states where historically it's been very strong, like Florida is an example, there is evidence that state legislatures are much more open to passing gun control laws.
I thought, instead of us all just bemoaning the fact that we are helpless against the NRA influence at the national level, at the state level, you can imagine us beginning to just lock down a lot of states.
Just get much tighter across.
I mean, imagine if 80%, if 40 states, if 40 states had really, really great gun control laws, that would make a really big difference.
At least then you could come up with local solutions, right?
You could start to figure out what would work in my state?
And what are the specific laws that are most likely to be acceptable to the citizens in my community?
And I don't know, I wonder if we might have greater success.
Yeah. I love this idea.
I think it's very promising and sort of keeping with the political values also that we live in a decentralized nation and in a federal system.
But it sounds like no one has talked about, let's do political action.
Like let's come up with a campaign to make people pull their kids out of school, vote, blah, blah, blah.
And are we just like beyond that?
I mean, do you not even buy into that stuff?
I keep coming back to the political power that the NRA wields at the national level.
And so the other path I kind of went through in my head was, and maybe this is a subject for another podcast, but we've got to think really hard about getting the vote out.
And I spent some time thinking the other day about what would it take to just dramatically increase voter turnout among 18 to 25 year olds?
Just among 18 to 25 year olds?
What would it mean to put polling places on college campuses to get companies and Facebook and Google and just everybody to get all of these young adults registered to vote and then make it really easy for them to cast their votes?
I mean, just think about it.
How is it that I can do everything on my smartphone?
And I cannot vote. That is so remarkable.
It is remarkable. It is remarkable.
Everything you can do.
Everything is getting more and more convenient.
Except voting. Okay, Felix, what do you have?
So, as you know, at HBS, we often ask our students to imagine that they're in the shoes of a decision maker.
So imagine you get this call and the person at the other end is a gentleman named Jeff Bezos.
And he expresses interest in locating the second Amazon headquarters in Boston.
At that moment in time, you have every degree of freedom.
You can say yes. You can say no.
You can say yes, but and stipulate a bunch of conditions.
What will your answer be?
Do you want Amazon's second headquarters in Boston?
So my answer would be yes, but.
I'm with yes, but too.
You go ahead. So there's a reason why all these cities are competing for these headquarters.
And the reason is there's so much evidence that the positive ripple effects probably exceed even those that I think the average citizen would imagine.
So you think, oh, okay, it's going to create a bunch of jobs.
But even beyond that, the ripple effect of an anchor company like that and the kind of ecosystem of business that would end up being created around it.
Now, having said that, it creates disruption.
And so the conversation that I would want to have with Amazon is how do we make that transition, particularly for the most at risk citizens?
How do you create a transition that makes sure that they don't fall through the cracks?
Right. So I mean, I think it's definitely yes, but, and the following two caveats.
So the but is, first, you don't want to give away the store for the contract.
And then the second thing is this notion of displacement.
And of course, in this setting, as per what's happening in Seattle today, the major negative consequence, I think is on housing prices on display.
That's right. Yeah.
So let me drill down on that adjustment process.
So the hardest part, as you point out, has to be the housing market, what to do about the housing market.
You look at Zillow today.
A two bedroom apartment in the Boston area rents for $2 ,713.
Okay. So that means you think about the federal guidelines that say don't spend more than roughly 30 % of your income, essentially, Boston has become unaffordable as it is.
So now you add a company like Amazon that will bring thousands and thousands of employees, many of whom will have, you know, nice paychecks.
So if it's in East Boston, they will just crowd out everyone who lives there.
So now it's easy to talk about adjustment, but like, what will we actually do?
So for sure, rents will go up even higher.
Right? Without, without a doubt.
I guess the ironic thing about this kind of displacement, it matters completely whether you are a homeowner or you are a renter.
Yes. For prices to go up, if you're a homeowner, you get to share in the prosperity.
If you rent, you don't.
So then you think, okay, what you're doing is you're creating a division between homeowners and between renters.
And so if you focus the problem that way, I would think about, okay, so what are we going to do with all of these at risk renters who are in their middle and senior years, you've got to create alternative housings, you've got to subsidize, you've got to do something, but that's hard, right?
Yeah. I mean, these are not easy solutions.
I think it's actually really interesting.
Part of, I think, what cities bring is sort of the enjoyment of diversity.
So I might like diversity in sort of a racial sense.
I might like diversity in a class sense.
I might like diversity even in age.
The irony is by moving to places where we get to experience that diversity, often we undermine the very thing we love.
Like my wife and I are actually the perfect example.
When we moved to Boston from Philadelphia, we looked at the different neighborhoods and we ended up buying a place in what's now called Cambridge Port.
And part of what we loved about Cambridge Port was that it was so much more diverse than Harvard Square and many of the other places that we looked at.
And of course, what's happened in the 15 years since, lots of people like us who love diversity moved into the neighborhood.
And then you see this classic division.
So everybody who owned their home was able to stay.
Everybody who rented had to move away.
But we were the ones in a way that tore apart the fabric of the local community.
And so typically as consumers, if we have preferences, the market is pretty darn good at giving us what we want.
But when it comes to diversity, somehow doesn't work that way.
Yeah, I think this is a really hard problem.
And it's playing out in such dramatic ways, right?
In Seattle, it's playing out, in San Francisco, it's playing out.
I mean, broadly, there's a category of solutions that I don't like.
I can tell you that.
You know, so if you think about price controls or rent controls, I think that's complicated and problematic.
The other possibilities are, you know, there's these things in New York that are quite common now called inclusionary zoning.
So you kind of say, like, in this place, if you want to build, 30 % has got to be lower middle income.
And then I think the really big issues are supply, you know, which is the incentives to build are kind of not pronounced enough.
What I find is an interesting idea is to create structures that maximize or enable the type of interaction I think that many people like.
So I give you one example, our general tendency is to say, OK, so we don't have enough housing for less affluent families, let's build the kind of housing that they like.
And then we do the thing that we did in the fifties and sixties, which turned out to be really horrible.
We all put it in one place.
What about if we designed for diversity?
So, for instance, every structure that will house the elderly will also have a school built into that same neighborhood or will have a kindergarten in the basement of the types of apartments that older people typically enjoy.
And so I think it's by zoning in ways that facilitate interactions, just to give you a sense, like Boston grew by by 8 % in the last couple of years.
Right. So people really love this experience of being in the city.
Why I think it's interaction, it's diversity.
That's what people look for.
But that's not how we zone.
But let me try to push back on this, Felix, which is it's diversity of a certain type.
So like NIMBY ism or not in my backyard ism is like a huge problem in low income and medium income housing.
We talk about diversity, but then when the rubber hits the road, do we want a big chunk of the block next door to be allocated in that way?
The issue is exactly this big chunk.
Right. So you're saying smaller chunks.
Small. But NIMBY ism is look, you have these communities like San Francisco and Seattle, very liberal communities.
Talk about diversity.
They have not been able to actually build low income housing and have it put in neighborhoods, which you would have thought that people would appreciate the diversity.
And that's about the hypocrisy of this issue.
But the other thing I would say is that we say we want diversity, but at the same time we want improved services.
So one of the things that always happens with gentrification is that in that particular neighborhood where gentrification happens, you see a pretty dramatic improvement in the services offered.
Everything from the local neighborhood grocery store to just all the conveniences around just start to proliferate in a much nicer way and more convenient way.
And so we want that, too.
We want the whole experience to be elevated.
But then we say, oh, but we would also like some diversity and those things aren't always compatible because someone has to pay for that.
But so the services point, I think is a fabulous point.
Right. So what you want is like this really beautiful city and then it has amazing services and it comes at the cost of people who have now the craziest commutes on the planet.
Yeah. Because they are going to be on a bus.
That's right. You know, and you see it to work at that dry cleaner, to work at that dry cleaner and you live two hours away because you cannot afford.
And so there's there's this hidden cost of producing this combination of we need more density in the city.
We need additional capacity.
How do we get additional capacity?
We don't have more land.
We need more density.
What if you built, say, taller structures?
And then you would just have some sense of that not everything in the tall structure can be a five thousand square foot apart.
I see. Right. And so that would force some sense of creating access.
Do you really want to live in a city where everyone is like you or wherever where you know the only reason why people are not like you when you get served in the restaurant is because they got on a bus at 4 a .m.
In the morning. But I mean, I'll give you a coast.
I'll give you an example.
Right. So in the inclusionary zoning kind of stuff in New York, what have we observed?
We observed buildings coming up where the units that are low income housing or even moderate income housing have separate entrances.
Yeah. And the developers built them that way.
Yeah, literally separate entrances.
Yeah. And so but I guess my lesson from that story is there's a lot of cheap talk on diversity, you know, which is I don't know if people mean what they say.
And I'm not questioning you, but I'm just saying, like, in general, like, people say these things, but I don't know if they want it.
I love this idea. Meaning it goes to great principles in community development, right?
You want multi -use, you want shared access to resources.
But I guess the question is in these very liberal cities, we don't see it.
And I worry that it's just a lot of cheap talk.
I also think this is a case where there's a real genuine market failure.
I mean, I hate to be, like, totally boring, but I think the answer is the government provides housing because supply will not respond under the economic conditions other than through forced kind of zoning.
But to me, this feels like this is a setting where the 65 year old, 70 year old, who does not own a home.
That solution ain't going to be solved by some creative market based answer, right?
I mean, I think it's this is where the state becomes, I think, important.
And we have to kind of face up to that, I think.
I think what I loved about both of your answers, which to me is one of the big issues in all of this, is you both said yes, but.
And the yes, but happens at the one and the same time, right?
So what we tend to do is we first say yes.
And then there's this imagination that the market will take care of it.
And guess what? The market does not.
So this recognition that this is not something that the market will solve and that as a result, the moment you as a politician say yes, you have an obligation to think through the second order consequences of what you just said yes to.
And there is a role for government.
And these are special circumstances.
But there is really unlike in many other places, there is an important role for government here to create the conditions under which we think, oh, companies moving to new places and ending up dominating almost entire cities because they're so large.
That's a good thing.
That's a good thing if we take the but really serious.
So do you guys think we're going to get Amazon HQ to in Boston?
What do you think the odds are?
I've always felt like it made sense from the beginning.
I've always felt like high education capacity, some reasonable places where to go.
I can't think of another city except maybe Denver, which to me feels too close to Seattle.
So I have always liked Boston.
What about the South?
I was going to bet on Pittsburgh actually.
I think we have a good shot, but I think the problem with our region is that we're pain in the neck.
We are. I mean, we have something in common with Seattle in that regard.
All right, guys, it's time for our after hours picks.
Who wants to go first?
So I had an interesting experience.
You must get these in the mail, too, like a million privacy notices.
Like if you were not paranoid about privacy for sure, they're all rewriting their privacy policies.
Yes. But so in any case related to this, I wanted to recommend with some hesitation something called Google Takeout.
What Google has done is it's allowed people to see all the data that Google collects from you.
So go to Google Takeout.
Two clicks. I want everything that you have about me.
And then they send you a zipped file.
In my case, it was several gigabytes of data.
It can be huge. It can be really huge.
And so the delivery of the data, I think it's sort of what you'd expect from a company that makes privacy issues really seriously and that look, I have nothing to hide.
I'm just going to show you everything I have on you.
And then the hesitation comes in.
If you actually want to delete, that's a total pain still.
It's service by service.
Oh, no. I must have spent 20 minutes to try to delete my.
There's an entire history of every Google Hangout that you ever did with anyone.
Because they have every site.
You've ever searched.
So I mean, the level of detail is actually amazing.
Like every app that you ever opened on your Android phone, every ad you ever saw is a separate entry.
So the amount of data and the detail is really amazing.
And can you request them to delete it?
That's the less perfect part.
But I thought, you know, sort of as a stance and why I wanted to recommend the services for a company to say, and here's everything we have.
That actually, I thought, was pretty brilliant.
That was great. It was a it was an interesting, an interesting exercise.
I'm going to do it.
OK, so I have a book for you guys.
So the book is called Bad Blood Secrets and Lies in a Silicon Valley startup.
And it's the story of Theranos.
So remember, it was this company started by Elizabeth Holmes.
And the promise of this company was that with a tiny pinprick of blood, she claimed to have the technology to test for hundreds of diseases.
She was able to raise hundreds of millions of dollars.
At one point, her personal net worth was four billion dollars in the process.
This was a decade long saga.
She convinced Walgreens and Safeway to partner with her to the point where they not only invested in her, but they spent hundreds of millions of dollars opening up like these little kiosks in dozens of their retail locations in preparation to host this technology that she had.
And it was all a fraud.
She never had the technology.
I had this. So it's amazing.
So the author of this book is John Kerry.
And he's a Wall Street Journal reporter who broke the story.
I mean, this has to become a case study for our students.
But I have to say, there is one sliver of reassurance in the narrative and that is, if you look at the history of this company, what was remarkable is how many employees she turned through.
And the reason for it was that the engineers and the folks that she hired to come work for her, they just sensed that something was wrong.
And the number of employees who either quit or challenged her and said, wait, this doesn't seem right and therefore were immediately fired is really quite stunning.
So it's not a story where everyone was complicit.
On the contrary, I mean, no one who worked inside the company and who got fired ever talked.
Yeah. So one of the things she did is she managed through secrecy.
And so she kept everybody in this very tightly controlled silo.
So they only saw one piece of the puzzle.
And so when they left the company, you know, you had this sense of something was wrong.
I don't know how easy it was for someone to piece together the whole scale of the fraud.
But, you know, it is going to be a major emotion picture starring Jennifer Lawrence.
So so stay tuned. Stay tuned.
OK, so I have a pick.
It's summertime and you need a new drink for the summertime, I think.
And so I had my first of the season and I just want to share with everybody.
It is, I think, the perfect mid -afternoon pick me up in the summer.
And it is an affogato, which is an Italian name for a simple drink, which is a scoop of vanilla ice cream covered with a espresso.
And it's a little sweet.
It gives you a little buzz.
And you might say to yourself, wait a second.
Like, why don't I just get like iced coffee?
Which is totally wrong.
Yes. But you just described iced coffee.
No, no, no, I didn't.
No, I said a scoop of ice cream, vanilla ice cream with espresso.
And espresso is not coffee.
And ice cream is different.
And it is spectacular.
It is the perfect summer drink and I recommend highly to.
Can't wait for summer.
Exactly. All of you.
All right. But in order to order one, you have to remember what it's called.
It's an affogato, which is also a fantastic name.
And it's just a scoop of vanilla ice cream and espresso.
You can make it at home.
You don't have to call it an affogato.
Wow. All right. There you go.
Welcome to summer. Thanks, everyone, for listening.
This is HBS After Hours.
